C3.ai (NYSE:AI) Shares Gap Up - Should You Buy?

Key Points

• C3.ai shares opened higher, rising from a previous close of $11.53 to $12.30 and last trading near $12.18, while the stock remained above its 50- and 200-day moving averages.
• Analyst sentiment remains cautious: the stock has a consensus rating of “Reduce”, with 13 analysts issuing mostly Hold or Sell ratings and an average price target of $9.36.
• C3.ai exceeded quarterly earnings and revenue estimates, but revenue declined 25.4% year over year, margins remained deeply negative, and insiders sold more than 1.1 million shares worth approximately $11.7 million during the latest quarter.

C3.ai, Inc. (NYSE:AI - Get Free Report)'s stock price gapped up before the market opened on Monday. The stock had previously closed at $11.53, but opened at $12.30. C3.ai shares last traded at $12.1790, with a volume of 3,511,581 shares.

Wall Street Analysts Forecast Growth

Several research firms recently weighed in on AI. Canaccord Genuity Group reiterated a "hold" rating and issued a $10.00 target price on shares of C3.ai in a report on Thursday, September 3rd. Citigroup reissued a "market perform" rating on shares of C3.ai in a research report on Thursday, September 3rd. Northland Securities set a $16.00 price target on C3.ai and gave the stock an "outperform" rating in a research note on Monday. Weiss Ratings upgraded C3.ai from a "sell (e+)" rating to a "sell (d-)" rating in a research report on Tuesday, August 4th. Finally, Needham & Company LLC restated a "hold" rating on shares of C3.ai in a research report on Thursday, September 3rd. Two equities research analysts have rated the stock with a Buy rating, four have issued a Hold rating and seven have issued a Sell rating to the stock. According to data from MarketBeat.com, C3.ai presently has a consensus rating of "Reduce" and an average target price of $9.36.

C3.ai Stock Up 3.7%

The firm has a market capitalization of $1.92 billion, a price-to-earnings ratio of -3.89 and a beta of 2.11. The stock has a 50-day moving average price of $10.51 and a 200 day moving average price of $9.70.

C3.ai (NYSE:AI - Get Free Report) last released its earnings results on Wednesday, September 2nd. The company reported ($0.20) earnings per share for the quarter, topping analysts' consensus estimates of ($0.26) by $0.06. The firm had revenue of $52.38 million for the quarter, compared to analyst estimates of $52.06 million. C3.ai had a negative net margin of 192.10% and a negative return on equity of 61.25%. The business's quarterly revenue was down 25.4% compared to the same quarter last year. During the same period in the prior year, the firm earned ($0.37) earnings per share. As a group, equities analysts forecast that C3.ai, Inc. will post -2.21 earnings per share for the current fiscal year.

Insider Activity at C3.ai

In other C3.ai news, CFO Hitesh Lath sold 21,077 shares of the stock in a transaction that occurred on Wednesday, September 16th. The shares were sold at an average price of $10.48, for a total value of $220,886.96. Following the sale, the chief financial officer directly owned 371,036 shares of the company's stock, valued at approximately $3,888,457.28. This represents a 5.38% decrease in their position. The sale was disclosed in a document filed with the SEC, which is available at this link. The sale was made to cover tax withholding obligations related to the vesting of equity awards. Also, CEO Thomas Siebel sold 453,314 shares of the firm's stock in a transaction on Tuesday, August 11th. The shares were sold at an average price of $10.51, for a total transaction of $4,764,330.14. Following the completion of the sale, the chief executive officer owned 722,362 shares in the company, valued at $7,592,024.62. The trade was a 38.56% decrease in their ownership of the stock. Additional details regarding this sale are available in the official SEC disclosure. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Insiders have sold a total of 1,117,809 shares of company stock valued at $11,724,230 in the last quarter. 19.80% of the stock is currently owned by company insiders.

Hedge Funds Weigh In On C3.ai

Several large investors have recently bought and sold shares of the business. Arizona State Retirement System lifted its stake in C3.ai by 3.7% during the second quarter. Arizona State Retirement System now owns 37,168 shares of the company's stock worth $338,000 after purchasing an additional 1,310 shares during the last quarter. Empirical Financial Services LLC d.b.a. Empirical Wealth Management increased its stake in C3.ai by 12.7% in the first quarter. Empirical Financial Services LLC d.b.a. Empirical Wealth Management now owns 13,776 shares of the company's stock valued at $116,000 after purchasing an additional 1,548 shares during the last quarter. CoreCap Advisors LLC increased its stake in C3.ai by 34.0% in the second quarter. CoreCap Advisors LLC now owns 6,145 shares of the company's stock valued at $56,000 after purchasing an additional 1,560 shares during the last quarter. Western Wealth Management LLC purchased a new position in C3.ai in the first quarter valued at approximately $26,000. Finally, Allworth Financial LP raised its holdings in C3.ai by 13.6% during the second quarter. Allworth Financial LP now owns 26,660 shares of the company's stock worth $242,000 after purchasing an additional 3,185 shares in the last quarter. Hedge funds and other institutional investors own 38.96% of the company's stock.

About C3.ai

C3.ai, Inc is an enterprise artificial intelligence software company that develops applications and tools designed to help organizations use AI and machine learning to analyze data, automate processes and support business decision-making. The company's offerings are intended for large commercial enterprises, government agencies and other organizations managing complex operational and data environments.

Its product portfolio includes the C3 AI Platform, which provides capabilities for developing, deploying and operating AI applications, as well as prebuilt enterprise applications.

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